Page 1 of 32
MHA 710 EXAM 1 NEWEST 2025 PACKAGE DEAL|
MHA 710 HEALTHCARE ECONOMICS EXAM 1, 2 AND
EXAM 3 WITH COMPLETE ACTUAL EXAM QUESTIONS
AND CORRECT VERIFIED ANSWERS/ ALREADY
GRADED A (MOST RECENT!!)
What is "economics"? .....ANSWER.....A Map for decision making.
Economics analyzes the allocation of scarce resources.
What are some of the specific challenges faced by managers in
healthcare? .....ANSWER.....1. The central roles of risk and
uncertainty
2. The complexities created by insurance
3. The perils produced by information asymmetries
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4. The problems posed by not-for-profit organizations
5. The rapid and confusing course of technical and institutional
change
What does asymmetric information mean? Can you give an
example? .....ANSWER.....When one party in a transaction has
less information than the other party. For example, physicians
and other healthcare providers usually understand patients'
medical options better than patients do. Unaware of their
choices, patients may accept recommendations for therapies that
are not cost-effective or, recognizing their vulnerability to
physicians' self-serving advice, may resist recommendations
made in their best interest.
What is adverse selection? .....ANSWER.....A situation that occurs
when buyers have better information than sellers. For example,
high-risk consumers are willing to pay more for insurance than
,Page 3 of 32
low-risk consumers are. (Organizations that have difficulty
distinguishing high-risk from low-risk consumers are unlikely to be
profitable.)
What is the problem of scarcity? .....ANSWER.....Demand for a
good or service is greater than the availability
What does it mean to say people are assumed to make choices
rationally? .....ANSWER.....focuses on individuals' efforts to best
realize their goals, given their resources.
What does it mean to says resources are scarce?
.....ANSWER.....Anything useful in consumption or production that
has alternative uses.
What is opportunity cost? .....ANSWER.....Potential loss from a
missed opportunity. Passing up the next best choice.
What does "marginal" refer to? .....ANSWER.....The examination
of the costs and benefits through a small change in the
production of goods
, Page 4 of 32
What does efficiency refer to? .....ANSWER.....No way to
rearrange production of goods in a way that makes one person
more better off without making somebody else worse off. How
well an economy uses scare resources to meet the needs/wants
of their customers
How do positive economic statements differ from normative
economic statements? .....ANSWER.....Positive economics is
objective while normative economics is subjective. Facts/ What is
vs What should be
How can economics be applied to the health sector?
.....ANSWER.....Describe, Explain, Evaluate, Plan
As we progress through the chapters, think about the special
characteristics that apply to the health sector that might limit the
applicability of traditional economic models.
.....ANSWER.....Social determinants of health, few insurance
MHA 710 EXAM 1 NEWEST 2025 PACKAGE DEAL|
MHA 710 HEALTHCARE ECONOMICS EXAM 1, 2 AND
EXAM 3 WITH COMPLETE ACTUAL EXAM QUESTIONS
AND CORRECT VERIFIED ANSWERS/ ALREADY
GRADED A (MOST RECENT!!)
What is "economics"? .....ANSWER.....A Map for decision making.
Economics analyzes the allocation of scarce resources.
What are some of the specific challenges faced by managers in
healthcare? .....ANSWER.....1. The central roles of risk and
uncertainty
2. The complexities created by insurance
3. The perils produced by information asymmetries
,Page 2 of 32
4. The problems posed by not-for-profit organizations
5. The rapid and confusing course of technical and institutional
change
What does asymmetric information mean? Can you give an
example? .....ANSWER.....When one party in a transaction has
less information than the other party. For example, physicians
and other healthcare providers usually understand patients'
medical options better than patients do. Unaware of their
choices, patients may accept recommendations for therapies that
are not cost-effective or, recognizing their vulnerability to
physicians' self-serving advice, may resist recommendations
made in their best interest.
What is adverse selection? .....ANSWER.....A situation that occurs
when buyers have better information than sellers. For example,
high-risk consumers are willing to pay more for insurance than
,Page 3 of 32
low-risk consumers are. (Organizations that have difficulty
distinguishing high-risk from low-risk consumers are unlikely to be
profitable.)
What is the problem of scarcity? .....ANSWER.....Demand for a
good or service is greater than the availability
What does it mean to say people are assumed to make choices
rationally? .....ANSWER.....focuses on individuals' efforts to best
realize their goals, given their resources.
What does it mean to says resources are scarce?
.....ANSWER.....Anything useful in consumption or production that
has alternative uses.
What is opportunity cost? .....ANSWER.....Potential loss from a
missed opportunity. Passing up the next best choice.
What does "marginal" refer to? .....ANSWER.....The examination
of the costs and benefits through a small change in the
production of goods
, Page 4 of 32
What does efficiency refer to? .....ANSWER.....No way to
rearrange production of goods in a way that makes one person
more better off without making somebody else worse off. How
well an economy uses scare resources to meet the needs/wants
of their customers
How do positive economic statements differ from normative
economic statements? .....ANSWER.....Positive economics is
objective while normative economics is subjective. Facts/ What is
vs What should be
How can economics be applied to the health sector?
.....ANSWER.....Describe, Explain, Evaluate, Plan
As we progress through the chapters, think about the special
characteristics that apply to the health sector that might limit the
applicability of traditional economic models.
.....ANSWER.....Social determinants of health, few insurance
